Many people are ignorant about saving effectively. Spending money might be exciting but saving is more important and it takes self-discipline to do it. As an adult with responsibilities, it is a must. There are many ways to save money long term and short term. It has to do with dedication and consistency but once you hack it, you will be forever grateful.
Everyone has to save for various reasons. It could be for more present and consistent expenses such as rent, business, children’s school fees, gadgets and so on. You can also save for emergencies, retirement, and special projects. This article will teach you how to save from scratch. You can get a pen and paper to jot things down.
The first thing to learn is the art and science of budgeting. You might have heard the phrase ‘failure to plan is a plan to fail’. Without planning strategically, you might never learn to save. To budget, draw a table with three sections, in each section, write what you ‘need to have’, what you ‘want to have, and ‘like to have’ respectively. This will help you visualize your saving plans. Solve your needs first, when you do this over time, you will have money to solve your wants and so on.
Now, divide your income into three, 50%, 30%, and 20%. 50% percent should go to your needs such as rent, transportation, and other essentials. 30% can go to entertainment and 20% should be saved. If you need to save critically, you can save 30% of your income. You can also write down the events you are saving for. For example; ‘emergency funds’, ‘30th birthday’ or ‘Detty December’. An additional way to save is to keep money in a piggybank aka ‘kolo’. In these containers, you can keep the change that you do not need and little cash gifts. You can also decide to deposit a certain amount of money daily. This way, saving does not feel overwhelming. Then, with bank savings, you can save up to 30% of your income in fixed deposits.
However, to follow your plans, you need to live a minimalist lifestyle. This may mean having a roommate to split the cost of rent, buying thrift, using less costly gadgets, and so on. Sachet water is far less expensive than bottled water, you can boil water and store them in the refrigerator. Though all these may look inconsequential, managing costs like this in every area can help you minimize expenditures.
Many spend unnecessarily on outings. Instead of going to the movies now and then, you can subscribe on Netflix or Hulu. You can also do group subscriptions and split the cost with your friends. Learn how to say no to friends when they try to persuade you to spend, do not impress anyone. Do not buy ‘the things you don’t need or shoes and clothes you can't wear.' Rather than compete with your peers in fashion or lifestyle, compete with your old saving habits.
Lastly, look for ways to earn more, doing businesses, getting better jobs, investing in shares, side gigs, are all ways to do this. Remember, save money and money will save you!
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